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Facts
The Revenue filed an appeal against the CIT(A)'s order deleting an addition of Rs. 8,80,000/- made under Section 147 for unexplained cash credits (share capital/unsecured loan) under Section 68 of the Income Tax Act, 1961, for assessment year 2019-20.
Held
The Tribunal dismissed the appeal in limine, noting that the tax effect of the appeal (less than Rs. 60,00,000/-) fell below the revised monetary limits for filing appeals before the ITAT, as specified by CBDT Circular No. 09/2024 dated 17.09.2024. The Tribunal emphasized that CBDT circulars are binding on the Revenue.
Key Issues
Whether the Revenue's appeal is maintainable before the Income Tax Appellate Tribunal when the tax effect is below the monetary limits prescribed by CBDT Circular No. 09/2024.
Sections Cited
Section 68, Section 147
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Income Tax Appellate Tribunal, RAJKOT BENCH, RAJKOT
Before: DR. ARJUN LAL SAINI & SHRI DINESH MOHAN SINHA
आदेश / O R D E R
PER DINESH MOHAN SINHA, JM:
1. The captioned appeal filed by the Revenue, pertaining to assessment year 2019-20, is directed against the order passed by the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi [in short “the ld. CIT(A)/NFAC”] dated 12.07.2024, which, in turn, arises out of an assessment order passed by the Assessing Officer u/s. 147 of the Income Tax Act, 1961 (in short the ‘Act’) dated 02.03.2024. by the ld. CIT(A), which relates to unexplained cash credits in the form of share capital/unsecured loan within the meaning of Section 68 of the Act which comes in the ambit of tax effect of CBDT Circular vide Circular No. 09/2024 dated 17.09.2024.
Recently the CBDT has issued Circular No. 09/2024 dated 17.09.2024, whereby the monetary limits for filing of appeals by the Department before Income Tax Appellate Tribunal and High Courts and SLP before Supreme Court have been increased as measure for reducing Litigation. The revised monetary limits laid down in para-2 of this Circular are as follows:
Before Appellate Tribunal Rs. 60,00,000/- 2. Before High Court Rs. 2,00,00,000/- 3. Before Supreme Court Rs. 5,00,00,000/-
In the present case, the tax effect by the revenue is less than Rs.60,00,000/-. Though this appeal had been filed by the revenue on 12/07/2024 and was within the monetary limit in the form of tax effect for filing appeals before Tribunal, in view of the recent Circular of CBDT, even such appeals will be governed by the new monetary limits laid down in the CBDT Circular No.09/2024 referred to above.
It is a settled law that the Circulars issued by CBDT are binding on the Revenue. This position was confirmed by the Apex Court in the case of Commissioner of Customs vs Indian Oil Corporation Ltd. reported in 267 ITR 272 wherein their Lordships examined the earlier decisions of the Apex Court with regard to binding nature of the Circular and laid down that when a circular issued by the Board remains in operation then the Revenue is bound by it and cannot be allowed to plead that it is not valid or that it is contrary to the terms of the statute. The appeal under consideration has certainly been filed contrary to the Circular issued by the CBDT Circular No.09/2024 dated 17.09.2024.
In the event, the Revenue finds at a later point of time that the tax effect in the appeal is more than Rs.60 lakhs or despite low tax effect the appeal of the revenue is maintainable, the revenue is at liberty to move this Tribunal for recalling of this order.
In view of the above, we hold that the appeal filed by the Department, against the impugned order of the Ld. CIT(A), is contrary to the policy decision of the Department and as such the appeal filed by the Department in is dismissed in limine.
Order is pronounced in the open court on 30/06/2025.